There goes that cash… straight down the money pit.
But, hey, what’s $7 Billion among friends. Especially nowadays:
Chrysler LLC will not repay U.S. taxpayers more than $7 billion in bailout money it received earlier this year and as part of its bankruptcy filing.
This revelation was buried within Chrysler’s bankruptcy filings last week and confirmed by the Obama administration Tuesday. The filings included a list of business assumptions from one of the company’s key financial advisors in the bankruptcy case.
Now, a pessimist might say that the bailout money has gone down the black hole that these failing companies are and we will never see any of it repaid (even if the companies want to repay it). Unfortunately I am a pessimist. After all the government would much rather own or control these companies than get money back from them:
An Obama administration official confirmed Tuesday that Chrysler won’t be repaying the loans, though a portion of the bridge loan may be recovered by Treasury from the assets of Chrysler Financial, the former credit arm of the automaker which is essentially going out of business as part of the reorganization.
“The reality now is that the face value [of the $4 billion bridge loan] will be written off in the bankruptcy process,” said the official, who added that the 8% equity stake that Treasury will be receiving as part of the company’s reorganization is meant to compensate taxpayers for the lost money.
Like I said… shocking.
